Microsoft has come out with a new way to handle license keys called Key Management Service. Through this new way of volume licensing, Server 2008 and Vista machines will check in with a server to be authenticated instead of having to check in at the Microsoft site. To do this, you have to set up a KMS server (with software from Microsoft) as well as install a KMS Volume License Key (which is different than a traditional VLK). [more]
The drawback to this service is that you have to obtain the key from MS using a volume license agreement. Another issue is that you have to have 5 Server 2008 installations or 25 Vista installs for this to work (and VM machines do not count towards this number).
Microsoft Key Management Service (KMS) for Windows Server 2003 SP1 and later is part of Microsoft Windows Volume Activation 2.0. It allows enterprise users to host KMS on Windows Server 2003 to enable activation of Windows Vista and Windows Server 2008 using a KMS key.
Microsoft Volume Activation 2.0 is a set of technical and policy solutions provided by Microsoft’s Software Protection Platform (SPP) that gives Microsoft customers more secure and easier methods to manage their volume license keys.
KMS based activation allows enterprise customers to host a local service within their environment to enable activation of machines running Windows Vista and Windows Server 2008 volume editions within their environment, instead of activation directly with Microsoft. Computers that have been activated using KMS are required to reactivate by connecting to a KMS host at least once every 6 months.
KMS keys are provided through Microsoft’s Volume Licensing System portals (MVLS, eOpen). The KMS host needs to be activated once with Microsoft either online or via telephone.